A wallet or digital wallet is a tool that allows users to store and manage their private and public keys, which considerably simplifies the management of cryptocurrencies or digital assets. Although it is a widely used resource in the financial sector, some misconceptions have been generated about digital wallets, which we will mention below:
It is a tool for personal use
People have come to believe that wallets are tools designed to be used only for personal purposes; however, they can also be used by companies and businesses. Nowadays, many companies offer different payment alternatives, among which cryptocurrencies stand out. Because of this, many companies use wallets to accept payments in cryptocurrencies and manage these digital assets.
Using a wallet to receive cryptocurrency payments generates a mutual benefit for both companies and customers, as wallets improve the buyer’s experience by streamlining the payment process (giving customers more convenience and payment alternatives).
Store only cryptocurrencies
Because wallets became famous following the cryptocurrency boom, some think wallets are only for storing cryptocurrencies. However, many wallets allow you to store and manage diverse digital assets such as e-money, e-coupons, gift cards, cryptocurrencies, NTF, etc.
Only suitable for online payments
Because wallets are known for allowing online payments, there has been a myth that wallets are a tool that is only used to make payments 100% online. However, through wallets, companies can have a point of sale through an application or device (through a payment processor), thus allowing them to receive payments in person at the corresponding establishment or store.
Difficult to use
Since it is a digital tool, many people and companies think it is demanding to use wallets. However, wallets are commonly easy-to-use tools because of their intuitive design that allows them to be used by as many people as possible.
This “accessibility standard” is generated by the market, which is influenced by social networks since many users want their financial products and services to have platforms that are as user-friendly and intuitive as their favorite social networks or applications. This level of demand has motivated the companies providing this service to develop increasingly friendly and intuitive platforms.
Online wallets are less secure than hardware wallets
While hardware wallets (physical devices), or “non-custodial” wallets, are generally considered more secure than online wallets, or “custodial” wallets, this does not mean that online wallets are necessarily insecure.
Well-designed online wallets can have high security as long as the company behind the wallet implements different systems, protocols, and measures to increase its security level, such as two-factor (2FA) or multi-factor (MFA) encryption and authentication, security updates to address potential vulnerabilities, internal audits, level of compliance, etc. However, we must emphasize that each company (providing the wallet service) has different policies, protocols, and security measures, so one of the main recommendations at this point is to choose the right provider for our wallet.
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